The European Commission yesterday proposed abolishing banana quotas by 2006 as part of a controversial blueprint to reform the regime governing imports of the fruit.

The proposals, which also include plans for an interim regime based on tariff rate quotas (TRQ), are aimed at settling a trade dispute with the US and other countries.

However, they are expected to face widespread criticism both from banana exporting countries and, potentially, from within the European Union.

If approved collectively by the EU governments, the proposals would commit the union to introducing a tariff-only system by January 1st 2006.

The Commission acknowledged yesterday that most banana exporting countries, including many the EU wants to protect, would prefer a tariff rate quota regime. However, it said acceptance of such a system could only be achieved on a transitional basis to ease adjustment to a tariff-only solution.

Mr Bernard Zepter, Commission deputy secretary general who drew up the blueprint, said it had not been possible to draw up a long-term solution based on TRQ which would have complied with World Trade Organisation rules.

The EU is being forced to revise its current regime after a successful challenge at the WTO by the US and Latin American countries. The US earlier this year imposed sanctions valued at $191 million (€183 million) a year in retaliation against the EU's failure to implement changes.

Under yesterday's proposals, the interim arrangements would end on January 1st 2006 at the latest, by when the level of the flat tariff would have been negotiated in the WTO.

Mr Zepter said the EU would be open to negotiations with other countries ahead of the European Parliament giving an opinion on the proposals.